The Unexpected Way Apple’s Growth is Exploited by Competitors

When a company grows too large too fast, there's a temptation to do too much. On the other hand, simplifying for customers opens windows of opportunity for competitors. At WWDC 2014, we saw a glimpse of how Apple tries to strike a balance. Sometimes, the company wins dramatically and sometimes it falls short.

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Back when Apple was a relatively small company, about ten years ago, it was a an uphill battle against the Microsoft empire, fully embraced by enterprise and government. One of the tactics that Apple used was to be extremely technical and race forward with technology. That unsettled IT managers, but it also created great favor amongst thought leaders and senior scientists.

A minor war ensued between senior, influential scientists, especially at the national laboratories like Los Alamos, Lawrence-Livermore, Oak Ridge (as well as NASA) and the IT managers at those locations. Smart, technical leaders appreciated the aggressive approach to technology that Apple took — as well as the security of OS X compared to, say, Windows XP in its day. IT managers, on the other hand, sought the comfort of the enterprise-oriented Microsoft products even though they were expensive to license and stodgy to use.

After all, organizations don't make money by lavishing expensive Macs on all their employees.

In time, that led Apple to believe that everything it did, technically, was best for its customers and best for its bottom line. It mostly succeeded.

The Art of War

A strong trend, it seems to me, is for Apple's competitors to evaluate the holes in Apple's strategy and exploit those technical gaps for the benefit of the appropriate audience. Cloud storage has been one of those areas. Apple, which got off to a a rocky start with MobileMe, approached cloud storage gingerly for its own customers while businesses embraced the cloud and drove the technology. Apple's own cloud syncing seemed way behind.

Finally, competitive pressure and Apple's own learning curve allowed it to step into deeper waters and give customers what they wanted: more visibility and access into the file structure of their iCloud documents.

This competitive tactic shows no signs of slowing down even though Apple is a very powerful company to contend with. In those cases where Apple thinks it can put a hold on cool and desired technology, other powerful companies are more than willing to step in and fill the gap. Even if it's half-baked. In turn, that panics observers into thinking that Apple, for some reason, can't keep up. Apple bashing ensues.

My hope is that Apple will get better at filling the competitive gaps more wisely and carefully. No one would wish that Apple would expand to fill those gaps too urgently and get caught trying to do too much. It's a fine line to toe. So far, it seems that with elements like storage and networking, Apple has remained a little too conservative. Namely, IPv6, AirPort management, Time Machine, family storage, iOS device backups, iOS integration with the bloated iTunes, for example, need a complete rethink.

Large companies have large ambitions. The problem is, when Apple pulls back for the sake of simplifying for the customer, other large companies with large ambitions are more than willing to step in and create a stir.

Often, the customer is caught in the middle, deciding between the sound and fury of Apple's competitors and Apple's generally aggressive approach that nevertheless leaves some doors open to those competitors. It's a never ending challenge for Apple.

I agree that Angela Ahrendts is probably one of, if not the best, hire that Apple has pulled in recent history. I hope the boys don’t get all insecure about this and start undermining her because they feel threatened that she might become the frontrunner to succeed Tim, when that day comes. The one thing I that might still be a question mark is does she respect and buy into Apple’s culture of It’s All About the Product? She doesn’t need to be a product person, Tim isn’t, but she needs to totally believe that the product comes first. If she accepts the product-first ethos, and lights a fire under Apple’s retail ops, she could very well be CEO someday.

Still, future CEO or not, what a dazzlingly accomplished, talented and charismatic exec. Apple fans and stockholders should be excited. I love her already and we haven’t even met.

I too was impressed with Angela, especially if her quotes paint an accurate picture of her. If so, I also thought she might eventually become Apple’s CEO. I wish her much success at Apple, and hope she fares better than Ellen Hancock, former Apple CTO.